In Defense Of Social Shopping: Driving Sales And Loyalty

Social shopping, just hype not so long ago, is now being embraced by online retailers. For consumers, social shopping simply means involving others in your shopping experience through a variety of social channels. For brands, there’s been a shift in definition – from meaning the sharing of purchases socially, to converting social shoppers into social purchasers. But is the conversion happening as predicted?

A lot of research has shown that the potential for social commerce is there:

83% of consumers were found to be likely to visit a website recommended by a friend on Facebook (Channel Insider’s 2011 report)

90% of online consumers trust recommendations from people they know (eConsultancy)

70% of Americans looked at reviews before taking the next step to purchase (Google’s Zero Moment of Truth study)

But studies show that search and e-mail marketing, not social recommendations, are still the main drivers for online consumer spending. Recent research from Monetate (a provider of cloud-based technology for online marketers) has shown that social converts at a much lower rate than either search or email campaigns, with traditional e-mail marketing leading to the most conversions.

It’s still early in the game, though. Signs show that social shopping will play a big role in driving the next innovation in online retail, as well as companies’ sales. While it might not currently be the strongest in terms of conversions, social is here to stay. Retailers not only need to adapt to this new social world of commerce but learn how to effectively put it into action. Start planning now and get your brand ready for the time that social becomes one of the stronger cards you can play: it’s inevitable.

To stay ahead of the curve, marketers need to take a step beyond embedding the “Like” and “Share” buttons. In addition to leveraging Facebook, a number of niche platforms are creating great social environments for retailers to target consumers via both desktop and mobile. Keeping all this in mind, here are three of my favorite social tactics and examples of brands that are using them effectively. Retails brands: take note and use these to drive your own sales and stay competitive:

Incentivize Sharing

Fab.com is strategic at incentivizing consumers through social. Fab has seen sales conversion rates triple with the addition of features like the “Live Feed,” where consumers can view what’s being purchased in real time and make purchases of those same items themselves. And it’s paid off; Fab has seen consumers frequently purchase the most visible items from the “Live Feed” and, in that same vein, Fab incentivizes consumers to invite friends to join through shopping credits rewards. The credits are offered on a scale based on how many friends have joined and how much they’ve spent on the site. For example, once 50 friends have joined, the inviter is considered a “Prime Time Player” and receives free shipping for 2 months. Fab also incentivizes members with a $5 credit for uploading the first picture they’ve taken of a purchase, which is then posted on Fab’s Inspiration Wall.

According to Fab, 50 percent of their 5.5 million members joined as a result of social sharing. They’ve found that people who use these social features go on to purchase twice as much as users who do not engage in social on the site.

So the lesson here is, make sure your retail sites aren’t just incorporating social sharing buttons, but are encouraging sharing with incentives to boost those sales.

Use the social graph to suggest items and drive purchases

Karma (acquired by Facebook last May) is a clever gift-giving mobile app that not only allows you to choose and send gifts directly from your phone, it mines your Facebook friend’s updates to find birthdays, life events and even reads status messages for sentiment to catch potential gift-giving occasions.

A personal example: Because of Facebook’s ongoing changes to the newsfeed, I’d missed out on a long-distance friend’s update about giving birth to a baby girl. Karma’s app saw the mention and subsequent comments offering congratulations and suggested I send a gift to mark the celebration. I made the purchase, was grateful for not missing this life-changing event in my friend’s life and Karma made a sale.

Etsy also offers a similar feature suggesting gifts for Facebook friends based on their Facebook “Likes.”

Using your customer’s social graph to not only suggest purchases but also give them reasons to purchase is a next step in social commerce.

Create a Community

The teen focused retailer Wet Seal has a model example of a shopping community with their new feature, The Runway, a user generated virtual closet with hundreds of outfits put together with items available on their site. Looking at a product page for each item will share more outfits users have assembled with that item. There’s an iPhone app that lets customers look up any item while in the store and see what outfits have been put together including that item. A ‘Shop With Friends’ tab on Facebook allows users to share a shopping session in real time.

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